The Administration strongly supports, and looks forward to working with the House and Senate to enact, a multi-year authorization bill for the Federal Aviation Administration (FAA) that will provide a sound foundation for America's airport and airways system in the 21st Century. H.R. 1000 includes several provisions which could form the basis for such legislation, including enhanced Passenger Facility Charge levels, improved assistance for the families of airline accident victims, stronger protection for the disabled, and a phase out of the High Density Rule (except at Reagan National Airport). However, if H.R. 1000 were presented to the President in its current form, his senior advisors would recommend that he veto the bill.

This bill does not offset any of the significant increases in spending it would provide. By removing aviation spending from the requirements of the Budget Enforcement Act, H.R. 1000 would increase spending $21 billion above the baseline. As a result, H.R. 1000 would substantially reduce the budget surplus, which the President proposes to reserve pending enactment of a plan to ensure the long-term solvency of Social Security and Medicare reform. In contrast, increased ground transportation spending in the Transportation Equity Act for the 21st Century (TEA-21) was fully offset, consistent with the requirements of the Balanced Budget Act and Budget Enforcement Act.

It is our understanding that the rule makes in order an amendment that would direct OMB to reduce the caps by baseline estimates of spending for these programs. This amendment does nothing to address the increased spending that would come from the surplus under the Committee bill. At the same time, the amendment would require reductions in the caps that would put all other discretionary programs at a disadvantage, including national security, veterans medical care, education programs, science and technology programs, and the National Institutes of Health.

This bill also removes aviation trust fund spending from the unified federal budget. Since 1985, Congress and the Administration have accepted the principle that receipts and spending should be combined into one budget. A unified budget presents spending tradeoffs and permits more fully informed decisions to be made on allocating the Nation's resources.

The Administration urges the Congress to address these issues. In addition, the Administration will work with Congress to:

Eliminate constitutional issues regarding the separation of powers and presidential authority to appoint and remove officers of the Executive Branch.

Amend the section on conflict of interest waiver to delete the requirement for Presidential action.

Conform the $5 billion authorization for the AIP to the Administration's request of $1.6 billion and the authorization for Facilities and Equipment to the Administration's FY 2000 Budget request.

Delete the requirement to establish a new program to subsidize air traffic control "contract towers" that otherwise would not qualify for FAA funding. The Administration strongly supports the existing contract tower program, but opposes this new program because it would divert scarce Federal aviation dollars to non-cost-beneficial activities.

Delete the provision that would delay enforcement of necessary safety standards for certain pilots.

Expand innovative financing options available to States by authorizing them to use block grant funding to establish revolving loan funds.

Delete the provision that would significantly constrain the Department of Transportation's responsibility for oversight of FAA regulations.

Delete proposed sections 41763 (b) (1) (D), (d)(2)(C) and (d)(2)(F) in section 211, which would delay budgetary recognition of the subsidy cost of a loan and permit the Federal Government's position to be subordinated to other creditors in the event of a default. Subordination of the Federal Government's position would be especially contrary to sound credit principles, since it threatens the taxpayer interest and reduces the number of loans that can be made by increasing the subsidy cost of the program.

Amend the provision regarding the use of Flight Operations Quality Assurance (FOQA) data in enforcement actions to preserve Administration discretion in deciding upon the basis for and propriety of bringing enforcement actions.

Add a private right of action and the award of reasonable attorneys fees to the protections afforded persons with disabilities by the bill.

Delete the reference to the Office of Government Ethics in the amendments relating to the Centennial of Flight Commission.

Finally, H.R. 1000 should be amended to provide that FAA's "personnel management system is governed by merit system principles consistent with those expressed in 5 U.S.C. 2301," as proposed in section 212 (d) of the Administration's draft Federal Aviation Act of 1999, transmitted to Congress by the Department of Transportation on February 8, 1999. The Administration also looks forward to working with Congress to improve H.R. 1000's provisions relating to public aircraft.

Pay-As-You-Go Scoring

H.R. 1000 would affect direct spending and receipts; therefore, it is subject to the pay-as-you-go requirements of the Omnibus Budget and Reconciliation Act of 1990. OMB's scoring estimate of this bill is currently under development.